Florida Real Estate Blog

Florida's 2012 Hurricane Season Just 1 Week Away - Get Ready!

MIAMI – May 25, 2012 – Thanks to El Nino and other conditions, forecasters predicted yesterday that the 2012 hurricane season – which starts exactly one week from today and runs through November – will be normal. It will see nine to 15 tropical storms with four to eight of those becoming hurricanes. One to three of those could become major storms, defined as ones with winds greater than 110-miles per hour.

Before the season begins, homeowners should prepare. “It’s crucial for policyholders to know about their insurance coverage before a storm hits,” says Ken Enscoe, Nationwide’s director of catastrophe claims operations. “Advance planning is key to surviving the aftermath of a hurricane.”

General steps to prepare for storm season

• Before an event, examine your property for physical or liability hazards.

• Find out if your home meets current building code requirements for high-wind regions.

• Check the four critical areas where wind can enter a home: roof, windows, doors and garage doors. Either you or a building contractor can build and install temporary protection, such as approved wind shutters or plywood on windows and coverings for patio and entry doors, strengthen and stiffen garage doors, and install heavy-duty door hardware.

• Read and understand your insurance policy.

• Inventory valuables and contents in the home with pictures or video. Note the approximate value of each item and the date of purchase. You can also send an inventory to a family member outside your region for safekeeping.

• Make sure important documents, such as an insurance policy or mortgage papers, are stored in a safe deposit or fire safe box.

• Floodwater that enters into a home may be covered by specialized flood coverage underwritten by FEMA’s National Flood Insurance Program. Check with your insurance agent about flood policies, but note that they take 30 days to become effective once you sign up.

© 2012 Florida Realtors®

Reprinted with permission. Florida Realtors®. All rights reserved.

Note from JOHN ELWELL: Next week I will post more information about the hurricane season and how to prepare for one if it hits us. I will include links to state websites that you will find useful as you get ready. So check back after Memorial Day!

Real Estate Agent John Elwell in the TOP 30 CENTURY 21 Agents in North & Central Florida - 1st Quarter of 2012

CENTURY 21's national offices have just released the rankings for the number of sales during the 1st quarter of 2012. This time around I am in the Top 30 of all of the agents working for CENTURY 21 in North and Central Florida. And trust me, there are a lot of agents out there working. The ranking was based on the number of "sides" sold. So basically, the number of housing units sold during that period.

I credit a lot of this success to my work on the internet. I am one of the most internet adept agents in our area and now work on over 50 sites to get my homes more exposure. In the past year I have also incorporated videos into my marketing strategies. People just love to watch these short clip tours that give them a better idea of what a property is like. I believe that they are effected and I enjoy doing them!

I am hoping that pace continues on through the summer even though our "snowbird" visitors will not be here. With prices apparently bottoming-out and starting to again rise, especially in the Sunshine State, people may finally decide to get off the fence and purchase a home before the prices go up too high. And of course, interest rates are still rock-bottom. Housing affordability is seldom this good.

So here's to optimistic hopes that I will stay in the TOP 100 for the remainder of the year! I will certainly do my best to achieve that personal goal!

If you are considering buying and/or selling a home, please feel free to give me a call and see what I can do for you. Just call JOHN ELWELL - REALTOR at CENTURY 21 Bill Nye Realty, Inc. 813-783-4444. Licensed in Florida.

After 5 Years, Federal Government Reports that Home Prices Increased in 1st Quarter of 2012

WASHINGTON – May 23, 2012 – U.S. house prices rose 0.6 percent in the first quarter of 2012 according to the Federal Housing Finance Agency’s (FHFA) seasonally adjusted purchase-only house price index (HPI).

HPI price changes are generally smaller than other indicators because they’re based on same-home selling prices for homes under government-owned Fannie Mae and Freddie Mac. The purchase-only index is based on more than 6 million repeat sales transactions.

Comparing year-to-year, the seasonally adjusted house prices rose 0.5 percent compared to first quarter 2011.

Comparing month-to-month, FHFA’s seasonally adjusted monthly index for March was up 1.8 percent from February.

“Consistent with other housing market indicators, the FHFA HPI showed stronger house prices in the first quarter, most notably in March,” says FHFA Principal Economist Andrew Leventis. “Increased affordability and a somewhat smaller inventory of homes for sale are positively impacting house prices.”

Findings:

• The seasonally adjusted purchase-only HPI rose in the first quarter in 30 states and the District of Columbia.

• The top five annual increases were Hawaii (10.3 percent), Washington, DC (9.8 percent), Iowa (5.7 percent), Florida (4.7 percent) and North Dakota (4.4 percent).

• Of the nine census divisions, the Mountain division experienced the strongest prices in the latest quarter, posting a 1.4 percent increase. Prices were weakest in the New England division, where prices fell -0.7 percent.

© 2012 Florida Realtors®

Reprinted with permission. Florida Realtors®. All rights reserved.

Things Looking Brighter for Florida Housing Markets in April 2012

ORLANDO, Fla. – May 22, 2012 – Florida’s housing market had increased pending sales and higher median prices in April, along with a greatly reduced inventory of homes and condos for sale, according to Florida Realtors® latest housing data.

“Here in Florida, we’re seeing some strong numbers that show positive momentum for the state’s housing recovery and our economy,” said 2012 Florida Realtors President Summer Greene, regional manager of Better Homes and Gardens Real Estate Florida 1st in Fort Lauderdale. “Home prices continue to rise in many markets. Inventory is down to extremely low levels while pending sales are on the rise – almost 38 percent for single-family homes and 25 percent for townhomes and condos. It is not unusual to see multiple offers.

“Now the challenge will be for appraisals to catch up. Overall, we are very happy to see the market move in this direction and expect this trend to continue.”

Pending sales refer to contracts that are signed but not yet completed or closed; closed sales typically occur 30 to 90 days after sales contracts are written.

The statewide median sales price for single-family existing homes in April was $144,350, up 10.2 percent from the year-ago figure, according to data from Florida Realtors Industry Data and Analysis department, and vendor partner 10K Research and Marketing. The statewide median for townhome-condo properties was $108,000, up 16.1 percent over April 2011.

The national median sales price for existing single-family homes in March 2012 was $163,600, up 1.9 percent from the previous year, according to the National Association of Realtors® (NAR). In California, the statewide median sales price for single-family existing homes in March was $291,080; in Massachusetts, it was $267,500; in Maryland, it was $225,601; and in New York, it was $215,000.

The median is the midpoint; half the homes sold for more, half for less. Housing industry analysts note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes.

Statewide sales of existing single-family homes totaled 17,544 in April, down slightly, 0.7 percent, compared to the year-ago figure. Looking at Florida’s year-to-year comparison for sales of townhomes/condos, a total of 9,765 units sold statewide last month, down 4.9 percent from those sold in April 2011. NAR reported the national median existing condo price in March 2012 was $165,200.

In April, there was a 5.8-month supply of single-family homes in inventory and a 5.7-month supply for townhomes/condos, according to Florida Realtors.

“The housing numbers for the state of Florida continue to signal recovery,” said Florida Realtors Chief Economist Dr. John Tuccillo. “Sales in 2012 are above where they were in 2011, a harbinger of a third straight year of improvement. More importantly, pending sales are up dramatically, and inventory is still falling. Financing constraints still mean that a significant percentage of these will not lead to closed sales, but with the numbers up, we are confident that closed sales will continue to rise.

“The increase in both median and average prices suggests that investors are having a strong impact on the market, soaking up lower priced inventory and causing buyers to move up the price ladder.”

The interest rate for a 30-year fixed-rate mortgage averaged 3.91 percent in April 2012, down from the 4.84 percent average during the same month a year earlier, according to Freddie Mac.

To see the full statewide housing activity report, go to Florida Realtors website at www.floridarealtors.org  and click on the Research page; then look under Latest Housing Data, Statewide Residential Activity and get the April report. Or go to Florida Realtors Media Center at http://media.floridarealtors.org  and download the April 2012 data report PDF under Market Data at: http://media.floridarealtors.org/market-data

© 2012 Florida Realtors®

Reprinted with permission. Florida Realtors®. All rights reserved.

Housing Affordability Was the Highest Ever in First Quarter of 2012!

WASHINGTON – May 17, 2012 – Housing affordability reached a milestone in the first quarter, according to the National Association of Realtors® (NAR).

NAR’s composite quarterly Housing Affordability Index rose to a record high of 205.9 in the first quarter of 2012. The Index provides a quick look at affordability and is calculated by the relationship between median home price, median family income and average mortgage interest rate. The higher the index, the greater the household purchasing power.

The first quarter marks the first time the quarterly index broke the 200 mark since NAR recordkeeping began in 1970.

“For those with good credit, we’ve never seen better housing affordability conditions or market opportunities than we see at present,” says NAR President Moe Veissi, broker-owner of Veissi & Associates Inc. in Miami and 2002 president of Florida Realtors.

Veissi thinks things could be even better if lending standards would return to normal.

“Although home prices are stabilizing and sales are rising, some buyers still have to jump through a lot of hoops to convince a lender that they are creditworthy, even for a mortgage that would be well within their means,” he says. “This is especially true for self-employed buyers.”

The index finds that a median-income family, earning just under $61,000, could afford a home costing $325,500 in the first quarter – more than double the national median existing single-family home price of $158,100. The median monthly mortgage principal and interest payment for a median-priced home would take only 13.5 percent of gross income.

A companion index measuring the ability of first-time buyers to purchase a home also set a record, with the first-time buyer index reaching 135.8 in the first quarter. Assumptions for the first-time buyer index include a lower income, at 65 percent of median family income, a starter home costing 85 percent of the median price, and a downpayment of 10 percent. In the first quarter, the typical entry-level buyer could afford a home costing $182,500, which is well above the overall median price.

“It’s never been easy to buy a first home because of the cash required for downpayment and closing costs, but conditions for first-time buyers who are able to get a mortgage have never been better,” Veissi says.

Most first-time buyers choose a loan with a lower downpayment, often an FHA-insured loan with 3.5 percent down, and some use the VA program with no downpayment.

Both home prices and mortgage interest rates are expected to edge up modestly as the year progresses, but housing affordability will remain very favorable with the median-income household well positioned to afford a median-priced home. For all of 2012, the index is projected to set an annual record, averaging 191 for the year.

© 2012 Florida Realtors®

Reprinted with permission. Florida Realtors®. All rights reserved.

Average Mortgage Interest Rates Drop to New Lows - Now just 3.79%

Today, 5/17/2012, Freddie Mac reported that the average mortgage interest rate for 30 year fixed-rate mortgages was 3.79%, down from 3.83% last week. The average interest rate for 15 year fixed-rate mortgages was 3.04%, down from 3.05% from last week. A year ago the 30 year rate was 4.61%. One has to wonder just how low they can drop and, even more importantly, how many of you will be able to lock in these low rates and get that home you have been waiting for. Lower rates not only make it easier to buy a home, but also make it easier to sell one. I hope many of you are able to take advantage of these rates. At some point, they will go up! That is a certainty!

Conditions in Europe caused yields on Treasury bonds to drop and that force a corresponding fall in mortgage rates. Some positive news here in the US was that industtrial production rose 1.1% in April and that was the largest gain since December 2010. And consumer sentiment during our current month of May rose to its highest level since 2008!

Home construction finally took off a bit and in April was at an "annualized rate" of 717,000 units. This was much higher than had been predicted. Home builder confidence also increased as a result.

Just from a personal point of view, it is not a terrible thing that new homes are being built since that creates more employment and more consumers. However, we need to walk a fine line so that we do not add too many homes to a housing market already saturated with normal sales and those of distressed properties, ie short sales and foreclosures. We need at least a little upward pressure on prices to help keep them stable for sellers. But from what we see, these are still good signes that our economy is recovering. Let us all hope it continues!

The job report for April was weaker than expected. Then the economic news out of Europe was not very good since both Greece and France had elections that seemed to run counter to the steps that had been taken to improve their economic situations. Now, who knows what will happen there? Markets don't like uncertainty and bond yields decreased. Mortgage interest rates went in the same direction. At least gas prices seem to be coming down. That will be welcome news for motorists this summer.

Do keep in mind that we are a very large country, So figures that come out for the entire nation, may have little or no relevance for your particular area. In the end, it is best if you speak with a local REALTOR or financing expert to see what the situation is for your part of the United States. Florida is not Michigan, nor is Maine the same as California. Market conditions can be very different from place-to-place. Also, your own credit history, the property you want to buy, etc. will effect your specific loan options and interest rates. Your mortgage broker or bank loan officer can give you more specific information.

If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.

If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be, should you decide to finance a home purchase.

I would also be happy to assist you in any way that I can. Just call JOHN ELWELL - REALTOR at CENTURY 21 Bill Nye Realty, Inc. : 813-783-4444 or e-mail me at: jelwell1@tampabay.rr.com You are also welcome at my webpage: www.jelwell.century21bnr.com  Licensed in Florida.

US Housing Market Finally Turning a Corner says The Demand Institute

NEW YORK – May 16, 2012 – Home values will start to climb again and related consumer industries will grow in 2012 and beyond as the U.S. housing market finally turns the corner, according to a new study released today by The Demand Institute, a new nonprofit, non-advocacy group formed in February by The Conference Board and Nielsen.

According to the Institute, the housing market recovery will have “far-reaching impacts in the coming years across the United States and international markets as U.S. consumers increase their spending on buying, renovating, furnishing and maintaining their homes.”

It also won’t be like earlier recoveries, the Institute suggests, with homestead owners leading the way. Instead, real estate investors buying rentals will supply the homebuying demand.

The Institute’s report, The Shifting Nature of U.S. Housing Demand, predicts that average home prices will increase by up to 1 percent in the second half of 2012. By 2014, home prices will increase by as much as 2.5 percent.

From 2015 to 2017, the study projects annual increases between 3 and 4 percent, though unevenly nationwide. The strongest markets “could capture average gains of 5 percent or more in the coming years.”

“In these initial years, the prime driver of recovery won’t be new home construction, but rather demand for rental properties,” says Louise Keely, chief research officer at The Demand Institute and a co-author of the report. “This is a remarkable change from previous recoveries. It is a measure of just how severe the Great Recession has been that such a wide swath of Americans had to delay, scale back, or put off entirely their dreams of homeownership.”

Bart van Ark, chief economist at The Conference Board and co-author of the report, says he doesn’t expect to see the homeownership rate to change.

“Over 80 percent of Americans in recent surveys still agree that buying a home is the best long-term investment they can make,” van Ark says. “What will be intriguing to watch is how their aspirations around homeownership are affected by this period of extended austerity.”

Between 2006 and 2011, some $7 trillion in American wealth was wiped out when home prices dropped 30 percent after dramatic climb in valuations during the housing bubble. Looking forward, the moderate growth expectations for coming years suggest a return to normalcy. As home prices continue to drop and interest rates fall further, first-time buyers and others who remained relatively cautious will be drawn back into the housing market. And, as the market recovers, so too will consumer spending.

“As the U.S. housing market strengthens, almost every consumer-facing industry will be impacted in the coming years,” said Mark Leiter, chairman of The Demand Institute. “Business and government leaders will benefit by fully understanding the nature of this recovery. In doing so they will be better able to anticipate how consumer demand will evolve, and to formulate critical business and policy decisions to lead their organizations.”

Key findings

In addition to the projected gains in home prices, the report discusses in detail the dynamics at work in the U.S. housing market and the impacts across industries. What follows are highlights from the report:

• The recovery will be led by demand from buyers for rental properties, rather than, as in previous cycles, demand from buyers acquiring new or existing properties for themselves. More than 50 percent of those planning to move in the next two years say they intend to rent.

• Young people and immigrants will lead the demand for rental properties. Developers and investors will fulfill it: developers by building multifamily homes for rent, and investors by buying foreclosed single-family properties for the same purpose.

• Rental demand will help clear the huge oversupply of existing homes for sale. In 2011, some 14 percent of all housing units were vacant, while almost 13 percent of mortgages were in foreclosure or delinquent – increases of 12 and 129 percent respectively over 2005 levels. It will take two to three years for this oversupply to be cleared, and at that point homeownership rates will rise and return to historical levels.

• The housing market recovery will not be uniform. Some states will see annual price gains of 5 percent or more. Others will not recover for many years. The deciding factors will include the level of foreclosed inventory and rates of unemployment.

• There will also be vast differences within states. Here, additional factors count, such as whether local amenities, including access to public transport, are within walking distance of homes. The report looks at seven factors and then sorts cities and towns into four categories, with each category predicting the speed of a local home price recovery.

• The average size of the American home will shrink. Many baby boomers who delayed retirement for financial reasons during the recession will downsize. They will not be alone. Most Americans will scale back their housing aspirations. The size of an average new home is expected to continue to fall, reaching mid-1990s levels by 2015.

• Consumer industries including financial services, home furnishings and home remodeling will experience shifts in demand and new growth opportunities. Part of this spending is linked to increases in wealth from improving home valuations, while an even bigger part is tied to the “transaction” of buying or selling the home which sets in motion increased demand for a wide range of products and services.

• Despite the number of Americans who have been hurt financially by the housing crash, the desire to own a home remains strong. The Institute doesn’t expect to see a long-term drop in ownership rates.

© 2012 Florida Realtors®
Reprinted with permission. Florida Realtors®. All rights reserved.

Happy Mothers' Day to My Friends in Zephyrhills, Florida, and around the Country!

In Spain, where I lived for 12 wonderful years, they celebrate Mothers' Day two weeks ahead of us here in the USA. But the sentiments are the same. To show appreciation to those women, without whom, none of us would be here.

If your mother is still living, give her a call to let her know you are thinking of her on this special day. And if she is no longer with you, take a second to conjure up one special memory you have of her. I think most of us have at least one special moment that keeps our mothers alive in our hearts no matter what. I can still remember mine dressing me up as an elf for our kindergarten play over 50 years ago.

So, give the ladies their due on this very special Mothers' (and Grandmothers') Day! They will appreciate it, without a doubt!

John Elwell - REALTOR at CENTURY 21 Bill Nye Realty, Inc. 813-783-4444

Licensed in Florida

Thanks to my friend Rick Wing for the great floral picture!

Florida in Top 5 States with the Greatest Home Price Appreciation! Sweet!

NEW YORK – May 10, 2012 – Tighter housing inventories are starting to lift home prices, says Anand Nallathambi, CoreLogic’s CEO.

CoreLogic’s latest home price index, which includes distressed sales, shows a slight month-over-month nationwide increase of 0.6 percent in home prices from February to March. But some markets are seeing much more of a price boost this spring, including Florida, which ranked No. 5 overall for home price increases.

“This spring, the housing market is responding to an improving balance between real estate supply and demand, which is causing stabilization in house prices,” says Mark Fleming, CoreLogic’s chief economist. “Although this has been the case in each of the last two years, the difference this year is that stabilization is occurring without the support of tax credits and in spite of a declining share of REO sales.”

States with highest appreciation

According to CoreLogic, the following states had the highest appreciation in March (this includes distressed sales):

• Wyoming: +5.9%
• West Virginia: +5.3%
• Arizona: +5.1%
• North Dakota: +4.7%
• Florida: +4.5%

States with biggest depreciation

Meanwhile, the states with the greatest depreciation, when also figuring in distressed sales, are:

• Delaware: -10.6%
• Illinois: -8.3%
• Alabama: -8%
• Georgia: -7.3%
• Nevada: -5.8%

Source: Melissa Dittmann Tracey, Realtor® Magazine Daily News

© 2012 Florida Realtors®
Reprinted with permission. Florida Realtors®. All rights reserved.

2012 First Quarter Home Sales Increase while Inventories Decrease: NAR

WASHINGTON – May 9, 2012 – Median existing single-family home prices are firming in many metropolitan areas, while improving sales and declining inventory are creating more balanced conditions, according to the latest quarterly report by the National Association of Realtors® (NAR).

The median existing single-family home price rose in 74 out of 146 (59 percent) of metropolitan statistical areas (MSAs) in first quarter 2012 compared to the same quarter in 2011; 72 areas had price declines. Only one quarter earlier – the fourth quarter of 2011 – only 29 areas (20 percent) had a year-over-year gain. The numbers are based on closings.

“Home prices are more volatile than normal because of sudden upswings in buyer activity in some localities, and also are affected by the prevalence of distressed sales,” says Lawrence Yun, NAR chief economist. “Home prices lag sales activity because the transactions were negotiated mostly in the previous quarter. Given the steadily dwindling supply of inventory and notably higher listing prices that are being negotiated today, prices are expected to show further improvements in the near future.”

Yun says housing inventory is a big part of the story.

“We now have broad shortages of lower priced homes in much of the country, with very tight supply in Western states for homes through the middle price ranges,” he says. “This is good news for many sellers who wish to list now or for those waiting for prices to improve.”

At the end of the first quarter, 2.37 million existing homes were available for sale – 21.8 percent below first quarter 2011 when 3.03 million homes were on the market. There has been a sustained downtrend since inventories set a record of 4.04 million in the summer of 2007.

The national median existing single-family home price was $158,100 in the first quarter – 0.4 percent below $158,700 in the first quarter of 2011. The median is where half sold for more and half sold for less. Distressed homes – foreclosures and short sales that sold at deep discounts – accounted for 32 percent of first quarter sales; they were 38 percent a year earlier.

Total existing-home sales, including single-family and condo, increased 4.7 percent to a seasonally adjusted annual rate of 4.57 million in the first quarter from a downwardly revised 4.37 million in the fourth quarter, and were 5.3 percent above the 4.34 million level during the first quarter of 2011 when sales spiked.

“This is the highest first quarter sales pace since 2007,” Yun says. “With strong market fundamentals, total home sales this year should rise 7 to 10 percent.”

NAR President Moe Veissi, broker-owner of Veissi & Associates Inc. in Miami, said there are more opportunities in today’s market. “Historically favorable housing affordability conditions are making it easier for buyers to enter the market despite the unnecessarily tight credit conditions,” he says. “Housing supply and demand are roughly balanced with overall housing supply at the lowest level in six years, putting sellers on an even footing with buyers in most markets.”

“Qualifying incomes are well below median incomes in most of the country, which means home buyers generally can stay well within their means,” Yun says. “For example, a buyer in Indianapolis making a 10 percent downpayment would need an annual income of $24,000 to purchase a median-priced home, while in Seattle it would be $55,300. For now, buyers are facing an extraordinarily advantageous situation if they can obtain a mortgage.”

The national median family income was $61,000 in the first quarter. However, to purchase a home at the national median price, a buyer making a 5 percent downpayment would only need a $34,700 income. With a 10 percent downpayment the required income would be $32,900, while with 20 percent down, the income drops to $29,300.

First-time buyers purchased 33 percent of homes in the fourth quarter, unchanged from the fourth quarter; they were 32 percent in the first quarter of 2011.

The share of all-cash home purchases in the first quarter was 32 percent, up from 29 percent in the fourth quarter; they were 33 percent in the first quarter of 2011. Investors, drawn by bargain prices and who make up the bulk of cash purchasers, accounted for 22 percent of all transactions in the first quarter, up from 19 percent in the fourth quarter; they were 21 percent a year ago.

In the condo sector, metro area condominium and cooperative prices – covering changes in 52 metro areas – showed the national median existing-condo price was $157,200 in the first quarter, which is up 3.4 percent from the first quarter of 2011. Eighteen metros showed increases in their median condo price from a year ago and 34 areas had declines.

Regionally, existing-home sales in the Northeast jumped 8.6 percent in the first quarter and are 6.6 percent above the first quarter of 2011. The median existing single-family home price in the Northeast declined 3.2 percent to $226,300 in the first quarter from a year ago.

In the Midwest, existing-home sales rose 5.5 percent in the first quarter and are 11.7 percent higher than a year ago. The median existing single-family home price in the Midwest increased 0.8 percent to $125,300 in the first quarter from the same quarter in 2011.

Existing-home sales in the South increased 2.1 percent in the first quarter and are 4.1 percent above the first quarter in 2011. The median existing single-family home price in the South rose 1.2 percent to $143,600 in the first quarter from a year earlier.

Existing-home sales in the West rose 5.9 percent in the first quarter and are 1.4 percent higher than a year ago. The median existing single-family home price in the West slipped 0.9 percent to $196,200 in the first quarter from the first quarter of 2011.

© 2012 Florida Realtors®

Reprinted with permission. Florida Realtors®. All rights reserved.